Correlation Between Hankukpackage and Digital Power
Can any of the company-specific risk be diversified away by investing in both Hankukpackage and Digital Power at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Hankukpackage and Digital Power into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Hankukpackage Co and Digital Power Communications, you can compare the effects of market volatilities on Hankukpackage and Digital Power and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Hankukpackage with a short position of Digital Power. Check out your portfolio center. Please also check ongoing floating volatility patterns of Hankukpackage and Digital Power.
Diversification Opportunities for Hankukpackage and Digital Power
0.02 | Correlation Coefficient |
Significant diversification
The 3 months correlation between Hankukpackage and Digital is 0.02. Overlapping area represents the amount of risk that can be diversified away by holding Hankukpackage Co and Digital Power Communications in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Digital Power Commun and Hankukpackage is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Hankukpackage Co are associated (or correlated) with Digital Power. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Digital Power Commun has no effect on the direction of Hankukpackage i.e., Hankukpackage and Digital Power go up and down completely randomly.
Pair Corralation between Hankukpackage and Digital Power
Assuming the 90 days trading horizon Hankukpackage Co is expected to under-perform the Digital Power. But the stock apears to be less risky and, when comparing its historical volatility, Hankukpackage Co is 1.4 times less risky than Digital Power. The stock trades about -0.04 of its potential returns per unit of risk. The Digital Power Communications is currently generating about 0.05 of returns per unit of risk over similar time horizon. If you would invest 590,873 in Digital Power Communications on September 1, 2024 and sell it today you would earn a total of 237,127 from holding Digital Power Communications or generate 40.13% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Hankukpackage Co vs. Digital Power Communications
Performance |
| Timeline |
| Hankukpackage |
| Digital Power Commun |
Hankukpackage and Digital Power Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Hankukpackage and Digital Power
The main advantage of trading using opposite Hankukpackage and Digital Power positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Hankukpackage position performs unexpectedly, Digital Power can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Digital Power will offset losses from the drop in Digital Power's long position.| Hankukpackage vs. Busan Industrial Co | Hankukpackage vs. Busan Ind | Hankukpackage vs. Mirae Asset Daewoo | Hankukpackage vs. Finebesteel |
| Digital Power vs. AptaBio Therapeutics | Digital Power vs. Daewoo SBI SPAC | Digital Power vs. Dream Security co | Digital Power vs. Microfriend |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Transaction History module to view history of all your transactions and understand their impact on performance.
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